Bank loan delinquency ratio rises at fastest pace

South Korean banks’ loan delinquency rate rose at the fastest clip in 15 months in October due mainly to increased defaults by construction firms and shipbuilders, the financial watchdog said Monday.The overall delinquency rate of bank loans to companies and households reached 1.28 percent as of the end of October, up 0.24 percentage points from the previous month, according to the Financial Supervisory Service. The rate is measured based on loans that are overdue for more than one day.The rise

Dec. 5, 2011

Listed firms’ interest coverage ability retreats with earnings slipped

South Korean listed firms’ ability to cover their interest costs with earnings slipped in the third quarter of this year from a year ago due to lackluster performances, a report showed Monday. The average interest coverage ratio of 612 firms listed on the local main bourse came to 5.11 times in the July-September period, compared with 6.01 times posted a year earlier, according to the report by the Korea Exchange and the Korea Listed Companies Association. The ratio measures a firm’s operating p

Dec. 5, 2011

Cardif Korea offers life insurance with lower cancellation penalty

Cardif Korea, a local insurance unit of French banking giant BNP Paribas, on Monday launched a variable life insurance product with higher returns than industry norms after cancellation, even within a year of contract.“We’re launching i plus VUL through nationwide branches of Shinhan Bank today. The strong point of the product is that it guarantees more flexibility and value to customers by increasing the cash surrender value even if policyholders cancel at an early stage of contract,” the compa

Dec. 5, 2011

Foreigners lead high frequency trading

Concerns rise over greater volatility generated by high frequency trading in KoreaForeign investors dominate high frequency trading in the Korean stock market, data showed on Monday, a practice regulators say fuels volatility. According to the report by the Korea Capital Market Institute, which tracked trading patterns of KOSPI 200 futures and options products that matured in December 2010, foreign investors made up 75.6 percent of high frequency traders in the local options market and 98 percen

Dec. 5, 2011

Shares edge up on eurozone optimism

South Korean stocks inched up 0.36 percent on Monday as investors were optimistic about Europe’s efforts to control eurozone budgets, analysts said. The local currency climbed against the U.S. dollar.The benchmark Korea Composite Stock Price Index gained 6.86 points, to 1,922.9. Trading volume was moderate at 324.9 million shares worth 4.1 trillion won ($3.6 billion) with gainers leading losers 485 to 338.“The index got off to a strong start but the gain was limited as investors remained cautiou

Dec. 5, 2011

Card firms urged to curb issuance

Customers’ card payment ceilings likely to be slashed to reduce soaring household debtTough screenings are expected for applications for new credit cards, starting later this month, as financial authorities strengthen supervision of card firms. Customers will also likely see monthly payment ceilings on new credit cards slashed sharply compared to the average ceiling on current cards, according to financial regulators.As part of policymakers’ efforts to curb snowballing household debt, the Financ

Dec. 5, 2011

Seoul shares likely to gain ground this week

South Korean stocks are expected to move upward this week, as an upcoming central bank meeting and a summit in Europe drive investor expectations for more actions to tackle the eurozone crisis, analysts said. The benchmark KOSPI jumped 7.86 percent, or 139.64 points, to 1,916.04 on Friday from a week earlier, as investors scooped up risky assets after global central banks said they will lower dollar-funding costs. A bank reserve ratio cut by China and strong employment reports from U.S. private

Dec. 4, 2011

Hana Financial chief pledges job security of KEB employees

Hana Financial Group chairman Kim Seung-yu has pledged to ensure the job security of about 8,000 Korea Exchange Bank employees if the group successfully acquires the lender.During a news conference on Sunday, Kim downplayed the possibility that Hana will conduct a massive manpower restructuring after a merger.He also said the financial group will file a bank merger application with the Financial Services Commission on Monday.The application will seek the regulatory approval of Hana Financial’s r

Dec. 4, 2011

Seoul shares likely to gain ground next week

South Korean stocks are expected to move upward in the coming week, as an upcoming central bank meeting and a summit in Europe drive investor expectations for more actions to tackle the eurozone crisis, analysts said. The benchmark Korea Composite Stock Price Index (KOSPI) jumped 7.86 percent,

Dec. 3, 2011

Shares end flat after surge

South Korean stocks finished nearly unchanged on Friday as investors sat on the sidelines after the key index’s rally in the previous session, analysts said. The localcurrency fell against the U.S. dollar.The benchmark Korea Composite Stock Price Index edged down 0.01 percent, or 0.14 points, to 1,916.04. Trading volume was moderate at 382 million shares worth 5.73 trillion won ($5.08 billion) with gainers leading losers 434 to 389. “There was no market trigger,” said Kwak Joong-bo, an analyst a

Dec. 2, 2011

BOK purchases more gold in November

South Korea’s central bank said Friday it had raised its holdings of gold in four months in November in an effort to diversify its portfolio of foreign exchange reserves worth more than $300 billion. South Korea purchased 15 tonnes of gold, raising the country’s gold holding to 54.4 tonnes at a value of $2.17 billion at the end of November, according to the Bank of Korea.The move marked the BOK’s second purchase of the precious metal so far this year. It bought 25 tonnes of gold bullion in June

Dec. 2, 2011

Hana set to seal KEB takeover deal with Lone Star

Hana Financial Group said in a regulatory filing to the Korea Exchange on Friday that it has reached an agreement with Lone Star Funds on an 11 percent cut in takeover price for Korea Exchange Bank. The official announcement, issued right after Hana held a meeting of board members Friday afternoon, marks the beginning of the last phase of the long-protracted acquisition deal that spawned a series of heated public disputes, legal wrangling and rampant speculation about pricing.Under the new deal,

Dec. 2, 2011

Hana, Lone Star agree to cut KEB price: report

Hana Financial Group has reached an agreement with Lone Star Funds on lowering the takeover price for Korea Exchange Bank, Dow Jones Newswires reported Thursday.An anonymous source was quoted by the U.S.-based news provider as saying that “Hana Financial agreed to a deal with Lone Star Funds to buy a 51.02 percent stake in Korea Exchange Bank for 3.916 trillion won ($3.48 billion), 11 percent lower than the original sales price of 4.41 trillion won.”A Hana spokesman declined to confirm the repor

Dec. 1, 2011

Listed financial firms‘ H1 net down 13.7%

South Korean financial firms listed on the local bourse saw their consolidated earnings for the April-September period slump 13.7 percent from a year earlier due mainly to global financial uncertainties, a report showed Thursday.The combined net profit of 28 securities firms and insurance companies with assets over 2 trillion won, such as Daewoo Securities Co. and Samsung Life Insurance Co., totaled 2.47 trillion won ($2.17 billion) in the fiscal first half, compared with 2.86 trillion won a yea

Dec. 1, 2011

Regulators consider stand-alone rating

Conglomerate units, public firms relying on external support likely to see their ratings dropKorea’s financial regulators are considering the introduction of stand-alone ratings to weed out nonviable affiliates which have inflated their corporate ratings through their links with parent firms with better ratings. According to officials at local ratings firms and financial authorities, the new system is being reviewed so that investors could check the viability of listed companies. The Financial S

Dec. 1, 2011

More than half of banks’ foreign debts come from Europe

More than half of the debts South Korean lenders borrowed overseas were from European banks, data showed Thursday, raising concerns about a possible foreign liquidity drain amid the spiraling eurozone debt crisis.As of end-June, South Korean lenders’ borrowing from European banks stood at $187.3 billion, or 53.6 percent of its total $349.4 billion foreign claims, according to the data by the Bank of International Settlements.By country, Britain was the largest creditor with $100.4 billion, follo

Dec. 1, 2011